captioning sponsored by macneil/lehrer productions >> woodruff: more violence in iraq as massive explosions rocked a government building outside baghdad today, killing at least 37 and injuring dozens. good evening. i'm judy woodruff. >> ifill: and i'm gwen ifill. on the newshour tonight, we get the latest on the bombings and security concerns from ed o'keefe of "the washington post" reporting from iraq. >> woodruff: then, we get an update from republican senator john cornyn on the federal budget standoff as negotiations enter a crucial stage. >> i just frankly don't think tax increases particularly

during a weak economy are likely to pass either the house or the senate. >> ifill: paul solman reports from cleveland on an effort to clear blighted communities by razing abandoned foreclosed homes. >> when you have an eye sore like this, it just takes away from neighborhood. people don't want to move into a neighborhood like this. t s anmoega' brnovor to montana's governor brian schweitzer on the race to clean up the oil spill on the yellowstone river. >> ifill: and ray suarez examines u.s.-venezuela relations as president hugo chavez fights cancer. >> woodruff: that's all ahead on tonight's newshour. major funding for the pbs newshour has been provided by: >> okay, listen. somebody has got to get serious. >> i think... >> we need renewable energy. >> ...renewable energy is vital to our planet. >> you hear about alternatives, right? wind, solar, algae. >> i think it's got to work on a big scale. and i think it's got to be affordable. >> so, where are they? >> it has to work in the real world. at chevron, we're investing

millions in solar and biofuel technology to make it work. >> we've got to get on this now. >> right now. the william and flora hewlett foundation, working to solve social and environmental problems at home and around the world. and with the ongoing support of these institutions and foundations. and... this program was made possible by the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. >> ifill: twin bombings shattered the calm in a city north of baghdad today. more than three dozen iraqis were killed, with 50 or more wounded. it was the latest sign of rising violence as u.s. troops prepare to withdraw. the charred remains of a car

bomb littered a street in the city of taji this afternoon. it blew up in the parking lot of a local government building, damaging nearby businesses and killing dozens of people. as ambulances and security forces rushed to help, they were hit by a second blast, this one from a roadside bomb. taji was only the latest target of attacks, including a raid that killed eight iraqis in baqouba and a bombing that killed 22 in diwaniyah. 40 more died in a baghdad bombing two weeks ago. and three american soldiers were killed near the border with iran last week. in all, 15 americans died in iraq last month, the highest toll since june, 2008. in washington today, a state department spokeswoman condemned the violence. >> the people doing this are not only enemies of the u.s., they're also enemies of the iraqi people and their desire to live peacefully and have stability in their future.

we continue to work with iraqi to ensure they have a full and strong and stable government. >> ifill: u.s. forces officially ended combat operations in iraq last august, and the remaining 47,000 troops are scheduled to withdraw by year's end. iraqi leaders are scheduled to meet this week to talk about asking for at least some of the u.s. force to remain. followers of shiite cleric muqtada al-sadr oppose that, demanding instead that u.s. forces depart as scheduled. for more on the uptick in violence in iraq, we turn to "washington post" reporter ed o'keefe. i spoke with him a short while ago from baghdad. ed o'keefe, we understand that june was the bloodiest month for the u.s. military in iraq since 2008. what explains this uptick in violence? >> that's right. there were 15 troops that were either killed or died in the month of june. u.s. officials here in baghdad and back in washington are fingering iran for helping at

least three shiite insurgent groups here in iraq. essentially they've been getting training and weapons from the iranian revolutionary guard special forces. some forensic testing that's been done on weapons that were used in attacks last week apparently shows that these are longer-range weapons. they're a lot more accurate. it suggests that the insurgents have been getting better training u.s. officials told me today. they are very concerned about this here but the u.s. continues to say that iraq is the one that is responsible for responding to these attacks because these attacks are happening on iraqi soil it's up to the iraqi security forces to step up and do something about it. they also point out notably that even if u.s. troops weren't here, this violence would be continuing all the more reason for the iraqi to step up and do something about it. >> ifill: if the u.s. says the iraqis should step up and do something about it, what does this tell us about the state of iraqi security right now? >> well, part of the reason or

part of the frustration among american officials is that while their pleas with how the iraqi security forces have responded, they're taken the lead in several counterterrorism measures. they're targeted insurgent groups over the past several weeks and months they feel perhaps they could be doing a little bit more. part of the problem is that the iraqi prime minister nouri al-maliki still hasn't named a new defense minister and a new interior minister. if there were leadership at the top of those two important ministries, perhaps there would be clearer direction given to the iraqi security forces to go out and target these groups a little more. that said for the most part if you talk to military officials here, they say a lot of progress has been made, that whether you're in infantry soldier in the iraqi army or part of the special forces you are better trained today than you were even just a year ago. >> ifill: in these attacks who is being targeted? military, civilians? is it something that doesn't have anything to do in many ways with the war itself.

>> you have two different types of attacks that have been going on. though there haven't been any this week, there have been attacks targeted at u.s. troops and u.s. installations most notably sources south along the iranian border. officials are concerned that they're getting the training and the weapons necessary. there was a pretty deadly set of explosions in the city of taji about 12 miles north of baghdad today. that's a sunni-dominated area. 28 were injured, 35 willed though it's believed dozens more were injured in that situation. there, local officials tell us you have more of a sunni-on- shiite kind of situation brewing. on monday across the country there were a series of attacks targeting local police and iraqi soldiers. you had a series of suicide bombings. you had booby-trapped vehicles. in some cases you had a continuing wave of targeted assassinations looking or targeting local police officials. in one case at least a

university official here in baghdad. targeted assassinations using silencer pistols as a newer type of violence in iraq when it's obviously troubling to local officials but it's just the latest example in sort of this ongoing violence. there's no real way to bring it altogether but it's a demonstration that still there are a lot of different problems. either it's targeting u.s. troops sectarian or it's targeting local government officials. >> ifill: you're talking about how the u.s. officials were perhaps laying this at the doorstep of iran. when we see one-two punches like we saw today in taji does that also bear the hallmark of al qaeda in iraq? >> yes. if you talk to u.s. officials they said today in fact this type of attack that focuses on the local or provincial government facility is the hallmark of al qaeda and of course because you have that one explosion followed by another that's something we've seen all over the world whether it's al qaeda in iraq or al qaeda in europe or any other corner in the world.

>> ifill: it's on the books for the u.s. to withdraw the last of its troops there by year's end. there are still what? 46,000 troops on the ground? is there any talk about extending the u.s. on the ground, the forces?ou >> there are several reports, even just out today that suggest that the u.s. officials are suggesting any number of troops, anything from 2,000 to 10,000 to 13,000. as one u.s. official joked to me a little while ago, he look, six months from now one of these reports will have gotten it right but tonight there is is no discussion going on between u.s. officials and the iraqis over how many troops might stay on beyond december. we had a conversation with the u.s. ambassador here over the weekend. he said, look, if the iraqi come to us with some kind of proposal, we will consider it. for us it's not about the numbers but what u.s. troops would do. most of them have focused on advise and assist responsibilities. they essentially hang back when iraqi forces go out to conduct counterterrorism measures or target other groups and only jump into it

if for some reason it's not going well. but you talk to military officials, they say things are going pretty well. the problem is iraq still can't defend its skies, still can't defend its ports down in basra and military officials say that the iraqi still want more training, whether it's basic infantry training or more specialized training so it's there that u.s. officials believe that the iraqis will come to them with some kind of a request. we're expecting the iraqi president to meet with the prime minister and other political leaders as early as this week to once again talk about this. there have been several meetings and nobody has reached conclusions just yet. the thought is perhaps we're getting much closer to some kind of a request that would be given to u.s. officials. at that point it lands back in the lap of president obama and the pentagon. they'll have to discuss this, figure out what exactly they can do, how many more troops could stay here beyond december. remember you've got 17,000 diplomats and security contractors that will be here working at about 15 different sites. they'll be working on police training, general diplomatic activities, economic

development, and several projects here as well. the american presence will continue beyond december. the question is will they be diplomats in plain clothes or will you also see several americans in military uniforms. >> ifill: and contractors as well. ed o'keefe of the "washington post," thank you so much. >> good to be with you, gwen. >> woodruff: still to come on the newshour: a republican take on high stakes deficit negotiations; leveling homes to save neighborhoods; the spreading yellowstone oil spill; plus, the road ahead for hugo chavez and venezuela. but first, the other news of the day. here's hari sreenivasan. >> sreenivasan: this was a deadly day for nato forces in afghanistan. the alliance announced four troops were killed in two separate attacks in the east. there was no immediate word on their nationalities. 280 nato service members have died in afghanistan so far this year. in syria, security forces and allied gunmen shot and killed 11 people in hama, where residents openly defied the regime of bashar al-assad. activists reported hundreds of

people irrn tedes and erected makeshift barriers to block troops and tanks now encircling the city. in washington, state department spokesman victoria nuland said it is the latest evidence that syria is using "intimidation and arrest" to erase all opposition. >> a week ago the positive example of a city in syria where peaceful demonstrations were allowed, where people were meeting each other and organizing and talking. today we see the town surrounded by syrian security forces so we're going in the wrong direction. >> sreenivasan: in 1982, then- president hafez assad, the current leader's father, crushed a rebellion in hama, killing as many as 25,000 people. nearly 200 people are feared dead after a boat carrying african migrants sank off the coast of sudan. sudanese police and a semi- official news agency reported the vessel caught fire and went down.

the reports said the passengers were being smuggled to saudi arabia, and that only three were rescued. the u.s. senate has postponed an effort to authorize the military mission in libya, at least, for now. majority leader harry reid announced today the senate will focus instead on cutting the national debt. the senate gave up its holiday recess to deal with the debt issue, and a number of republicans said they would vote to block taking up other matters. the libya resolution would authorize u.s. participation in the military mission for up to a year. wall street paused today after its recent rally. trading was light, and stocks were mixed. the dow jones industrial average lost nearly 13 points to close well above 12,569. the nasdaq rose more than nine points to close at 2,825. american abstract painter cy twombly died today in rome aftet ggle with cancer. he had lived mostly in italy for manyea s.ars. twombly's works featured scribbles, graffiti, and repetitive lines and unusual materials. some of his paintings sold for millions of dollars at auction. in 2010, he painted a ceiling of

the louvre museum in paris, the first american chosen for that honor since the 1950s. cy twombly was 83 years old. those are some of the day's major stories. now, back to judy. >> woodruff: president obama announced late this afternoon that he will host the bipartisan congressional leadership at the white house for continued talks on a deal to reduce the deficit and raise the nation's debt limit. he went before cameras at the white house today to argue what he sees as the terms of debate ahead of this next round of negotiations. >> it's my hope that everybody will leave their ultimatums at the door, that we'll all leave our political rhetoric at the door, and that we're going to do what's best for our economy and do what's best for our people. and i want to emphasize-- i've said this in my press conference-- this should not come down to the last second. >> woodruff: last week, jeffrey brown sat down with white house chief of staff bill daley to get the administration's take on the negotiations. tonight, we bring you the republican point of view.

senator john cornyn of texas joined me from capitol hill a short time ago. he chairs the national republican senatorial committee, and sits on the senate budget and finance committees. senator john cornyn, thank you very much for talking with us. >> thanks, judy. >> woodruff: the president also said earlier today that he believed there needs to be a big comprehensive deal now, not a short-term deal just to get the government through this debt limit date coming up this month. >> well, i think this is the opportunity, and this is the point of maximum leverage to try to get the best deal we can when it comes to spending cuts and the fix... and to fixing our broken entitlement programs which are going to run out of money within roughly the next decade but unfortunately the president is kind of late to the game. he delegated this to joe biden. eric cantor, jon kyl left those talks when it became apparent that they weren't making progress. so finally the president took

personal ownership and responsibility. i'm glad he did because only he and john boehner and mitch mcconnell are going to be able to leach a deal. there's not much time left to do that. i hope they go big. i hope we take advantage of this opportunity rather than have to deal with a piecemeal approach. >> woodruff: if democrats are prepared to give ground on entitlements on medicare and medicaid why can't republicans give some ground on the question of taxes especially, you know, we're talking about corporate taxes, doing away with tax breaks for people who own private jets? >> we're happy to talk to the president about tax reform, which is a commission, the simpson-bowles commission last december recommended. a lot of that is a good place to have a good extended discussion and to make our tax code flatter, fairer and simpler and also to make our companies more competitive when it comes to job creation here at home.

but what it sounds like the president really wants is in exchange for spending cuts he went to raise taxes on individuals including job creators here. i think it really is kind of a shell game. i think what voters said last november is they want government to live within its means. it's like saying, well, we'll give up our dessert but we're going to continue bingeing on the buffet. it just doesn't make any sense. >> woodruff: senator, the evidence at least what i've read is that right now the federal government is taking in tax revenues at the lowest percentage of gross domestic product in 60 years. if that's the case, then why isn't there some room for tax increase? >> because, judy, the one sort of revenue increase that we would support is to take the boot off the neck of the private sector because once that engine of job growth, economic growth gets back on its feet, then we'll see a lot more revenue into the treasury. that's why in addition to

cutting, we believe growing the economy can only be done by the private sector. if you raise taxes and are already burdened private sector which is reluctant to get back in investing in new jobs and new physical plants, raising taxes just makes their burden harder, not easier. with 9.1% employment i think we need to look at everything we can do to make it easier on job creators to create jobs not harder. raising taxes would make it harder. >> woodruff: but it's not just tax rates that have been low or tax revenues that have been low compared to what they were for the last 60 years. corporate tax as a percentage of domestic... gross domestic product, lowest it's been in a very long time. we know corporations are sitting on a lot of money. they haven't been creating jobs. so what is the evidence that they would create jobs if rates stay the same? >> well, one of the reasons they are sitting on that cash-- and yes, they become a

whole lot more efficient by laying people off and increasing automation and various things within their companies-- but they're sitting on that cash because they don't know what's going to happen in terms of tax rates, in terms of regulations, in terms of what the health care costs are going to be from the president's health care bill that they didn't anticipate and didn't factor into their business model. i think there's a lot of anxiety out there that if we could settle this issue that we're not going to raise taxes, we'll get past the spending problem by agreeing to spending cuts and entitlement reform, i think you'd see the markets breathe a sigh of relief and a lot of job creators would invest money into new jobs which is exactly what we need. >> woodruff: let me ask this from a citizens perspective. if you're a blue-collar medicare/medicaid recipient, you're prepared under this democratic proposal to share in some of the sacrifice. but meanwhile you're watching business owners, kporbt ceos, not share in the sacrifice.

how do you explain the balance to them or lack thereof? >> well i think... what i think my constituents in texas want is work. they want jobs. they're not being created now. across the country. we know that people who don't have a job, they can't pay their home mortgage and they're losing their home. so what we need now more than anything else in this country is jobs. we've seen the government through its failed stimulus program where they said the targeted goal is to keep unemployment below 8%. obviously it was not successful. so that leaves the private sector and apparently the president doesn't understand the anxiety that this lurching back and forth in terms of regulations and financial burdens associated with health care or just the uncertainty with regard to tax rates, what that's doing so the private sector. what it's doing is keeping them on the side lines. we need to settle this and calm down the politics here in washington long enough so people can figure out what the

rules are so they know what rules they're playing by. >> woodruff: we know, senator, the president today called on both sides to come to the white house this week for another meeting. said leave your ultimatums at the door. he's calling for a big, big compromise at this point. but let me ask you about what bipartisan folks like bowles, alan simpson, the center for responsible federal budget. i mean they're saying there's simply no way to get at this huge $14 trillion debt just on the spending side, that you have to go after revenues to get to that number. >> i think there's really two parts to that, judy. one is to reduce the overall business tax rate hopefully to make us more competitive globally. as i read president clinton reiterated today just makes sense if it's cheaper to do business here in the united states, then jobs will be created here. if it's cheaper to keep that cash and to create jobs abroad, that's what businesses will do

because it makes economic sense. but again i think the last thing i would think you would want to do when the recovery is is so anemic and when the private sector is sort of sitting on the side lines because they don't know what the costs of doing business are going to be, tax rates, regulatory policy, that i think we need to find a way to relieve that anxiety by saying, you know what? during a fragile economic recovery just like last december with the expiring tax rates the president agreed this is not a time to raise taxes. well, it's not still not a time to raise taxes with 9.1% unemployment. >> woodruff: columnist david brooks in the "new york times" today criticized what i said was the anti-tax faction in the republican party and said it does not accept the logic of compromise. he said this is a movement with no sense of moral decency because it's prepared for the united states to ignore the debt limit. >> well, mr. brooks apparently is not listening to the people that i'm hearing from in my state and across the country.

look, this deal is is not over yet. we still have some time. thankfully between now and august 2 to reach some sort of negotiated outcome. but what i think david brooks underestimates is what it's going to take to pass this. not only through the house but also through the senate. it's going to require 60 votes in the senate. so it will take more than the president having a press conference or having a meeting. we need to come up with a package that can actually pass both branches of the congress between now and august 2. and i just frankly don't think tax increases particularly during a weak economic recovery, are likely to pass either the house or the senate. >> woodruff: we hear you, senator john cornyn, thank you very much. >> thanks, judy. >> ifill: next, taking desperate measures in cleveland to deal with a massive foreclosure problem newshour economics correspondent paul solman has the story, part

of his ongoing reporting on the housing crisis and "making sense of financial news." >> reporter: in cleveland, ohio, someone's former home. since foreclosure, though, it's been stripped of anything you can sell, not even worth the price of the wood left behind. so down it goes-- an ever more common answer to the housing crisis-- clear the blight for alternative use. foreclosures hit especially hard here, hit especially early, quadrupling in a decade, making cleveland a test case of the tear-it-down approach. cleveland alone hosts some 13,000 vacant homes and the numbers keep piling up. >> in the next several years is probably going to be about 20,000 to 30,000 more like this in the county. >> reporter: gus frangos runs the county land bank, created to put property back to productive use.

but 80% of the time, that first means demolition-- $7,500 to level a place this size. >> naturally, we don't want to be just demolishing stuff forever, but before you can stabilize something, you have to stop the hemorrhaging. and so we have to bury the dead. >> reporter: land bank crews will pulverize 700 properties this year; the city of cleveland, 1,000-- to save sinking neighborhoods by eliminating the eyesores and, where possible, to put that land to economic use. >> probably, we're standing and looking at about seven or eight different lots where demolitions have occurred within probably 100 yards on either side. >> reporter: frank ford works at a housing nonprofit. alongside the post wrecking-crew lots, abandoned brethren. few foreclosures are being spiffed up, but that costs more than the backhoe. >> if you spend say $140,000 to bring back a house, all new mechanical systems, you're going to sell it for maybe $90,000-

$95,000. unfortunately, demolition is much more cost-effective, but we have to do it. >> reporter: "have to do it," because once-decent neighborhoods are on the doorstep of doom, due to houses like this one, sitting idle for years. betty ewing lives nearby. what does it do to the neighborhood that this place is abandoned, or places like it? >> look at it! the siding is off. that brings in people tearing off the rest of the siding. there are squatters that live in these houses. when you have eyesores like this, it just takes away from the neighborhood. people don't want to move into a neighborhood like this. >> reporter: on this block, 22 of 49 properties are abandoned. >> abandos. abandoned houses-- we call them "abandos"! ( laughs ) >> reporter: abandoned houses that have been left to rot, says longtime resident shawn dorsey. >> this was a very beautiful neighborhood, very beautiful. it looked like a suburb, but now it don't. raggedy. >> reporter: this was anita

gardner's home in better times, the early '70s. >> when i first moved here, everybody was blue collar workers. it was ford, chevy, chrysler, g.m., the steel mills. and i worked at trw valve division, so everybody was blue collar workers. there was a lot of money in this community and everybody took care of their homes. >> reporter: cleveland has been bleeding manufacturing jobs, and people, for years, shrinking from 900,000 in 1950 to less than 400,000 today. the new infusion of sub-prime lending seemed to offer hope, but made things way worse. >> for 40-some years, we've had a slow process of out-migration, loss of jobs, loss of population. think of that as like a river that's slowly moving and you're standing waist deep. then, you get the tsunami of the foreclosures from sub-prime lending ten years ago. and then, the banks get title to the homes after the foreclosure, and you can see how they've taken care of them. >> reporter: investment banks

once owned about 70% of the blinkered buildings in cleveland. but more and more, they're off- loading them as basement bargains to buyers looking to flip them for a fast profit. deutsche bank sold this house for $500 to a firm called x.b.y., llc. >> a company like this is going to put this on the internet, hope that some unsuspecting person sees it on the internet with maybe a flattering photograph from a different angle, and pays $1,000. and then, they've made $500 on top of their $500 purchase from deutsche bank for doing virtually nothing. >> reporter: is that now a viable business? you buy something like this for $500, put it on the internet, and hope a sucker somewhere else in the world is going to take it off your hands at a higher price? >> yes. if they do a volume, they do 50 or 100, and they make, say, $400 or $500 per house, it is a viable business >> reporter: not much reason to invest in landscaping, even if the law demands basic upkeep. >> the garage has had the tree on it for a year.

>> reporter: joe ayers has never met the hollywood investor who snapped up this scourge next door. according to councilman tony brancatelli, that's common here in his slavic village district. >> we've been getting investors from overseas who are buying properties on the internet, and it's been crazy because then we have to chase people down overseas. in the meantime, these poor residents have to deal with the after effects of it. >> reporter: resident farai malianga met a german investor and asked... >> "can you come and cut your lawn?" and he says, you know, "nein!" ( laughs ) >> reporter: at the cleveland housing court, judge raymond pianka fines owners who let their property go to seed. >> in december, we had to go on skype and skype a coptic bishop in cairo, egypt, who had purchased property in cleveland, ohio. we get calls regularly from israel, from the united kingdom of people who have purchased properties in the after market. >> reporter: please do not tell me that the coptic bishop in egypt is a deadbeat when it

comes to keeping up his property. >> he plead no contest. he repaired the property, he was fined, and he is no longer in housing court. >> reporter: foreign investors have been bottom-fishing for great deals, hoping the real estate market will stabilize. demolition is an alternative bet-- that the city can be redeveloped in untraditional ways. on lots like this, organic food for local, perhaps regional consumption. nine properties rotted here not long ago. >> we were able to clear the houses out and then create our community gardens. folks come from different blocks, from different areas, they come here, they build their gardens, they grow their produce. and folks can see pride in the community garden. >> reporter: on another abandoned plot where four houses once teetered, a sparkling instance of inner-city repurposing in the rough hough area, brainchild of mansfield frazier. "chateau hough?" >> yes. why not?

>> reporter: when i think of hough, i think the riots of the early and middle '60s. >> well, we prefer to call it a "uprising." and the land that we occupied is just as valuable to us as hunting valley where they raise horses. so if i were to say "chateau hunting valley" or "chateau westlake," nobody would raise an eyebrow. you say "chateau hough" and people do a double take. >> reporter: okay, one vacant- lot vineyard does not a winery make. but it may be a demonstration of how to turn "abandos" throughout the inner city into new revenue sources. >> it can show what can be done on an acre of land. i'd like for my neighbors to buy into it, buy their own acre of land, grow the grapes. then, i would buy the grapes and press them in my winery. >> reporter: and can you really grow grapes in ohio? >> along lake erie, there are numerous vineyards. most of them are about seven or eight miles inland from the lake, and you have to be near water. i'm less than two miles from the

lake, so i think mine will do better than theirs... at the end of the day. but that's yet to be determined. and if it's not great wine, it might make great vinegar, so i've got plan "b". >> reporter: wine or vinegar-- in the end, frazier's hopefully hearty perennials symbolize cleveland's post-foreclosure philosophy: anything's better than this. >> we've never found ourselves in this situation before with this magnitude of problem. neighborhoods in cleveland, at one time, maybe they might have 200 vacant houses at most, even the worst. now, were talking about neighborhoods with a thousand vacant houses, so the magnitude requires a different strategy. >> reporter: a strategy that's spreading to other places reeling from the foreclosure crisis-- wipe clean to start again from scratch.

>> woodruff: next, assessing the damage from an oil spill in montana and the effort to clean it up. jeffrey brown has the story. >> brown: one of the great western rivers, now stained in oil. three days into the spill on montana's yellowstone river, clean-up crews scrambled again today to contain the ooze.ea y t rising water levels, caused bsnincrltsed ocowme, bldked ef forts to reach some of the soiled shoreline. the lere o urccd last friday,ur upstream from the exxonmobil refinery in billings. a company pknelasine n ow then rt"sveilipedruveurpt on theur river bottom and spewed 42,000 gallons of crude into the water before the leak was stopped. exxonmobil initially played down reports that the spill had spread far beyond a ten-mile stretch of river. but by monday, company executive gary pruessing acknowledged the damage could be more extensive, and he pledged to do "whatever is necessary" to clean up the mess. >> we understand that we need to

get our full arms around where the exposure areas are. we have not fully completed that yet, so we continue to look downstream to make sure that we've identified all the areas that we need to address. >> brown: that news came as area residents voiced growing fears about the effects on their land. >> it's scary. i mean, i grew up here. this is my place. i know this place like the back of my hand. from what i'm looking at, there's oil all over the topsoil. i don't want my animals eating that. >> brown: for now, clean-up orwrs watched for the high waters to recede so they can begin checking the river banks for oil. and we're joined now by montana governor brian schweitzer, who toured the spill area today and joins us from helena. governor, welcome. what can you tell us about the scope of the damage so far? >> well first you need to understand that the yellowstone is the largest undamned river in the united states. it's one of those wonderful blue ribbon streams that we have in montana, some of the finest fisheries anywhere in the world. this pipeline spilled into the yellow stone river near

billings montana. it spilled into the river when it was running at near record high. we heard from some industry people that said that's great because the solution to pollution is dilution and these 42,000 gallons that's a very small part of this raging river. well the problem is that the river in enact was going over its banks at the time that the pipeline burst (inaudible) and fell into these lowland, these wetteland areas, these primordial areas where the mike robes feed the insects and the insects feed the reptiles and the reptiles of course feed the (inaudible) the river. now that the river is is going down this thick (no audio) is along those wettelands with those cotton woods and aspens in farmers' fields. we're left with trying to pick this up. i can tell you this that montana... well, montana's interests aren't perfectly aligned with us on the epas. our interests are for the wealth health of the yellowstone river, the people

of montana and a future generations. >> brown: governor, we're having some video problem. we'll try to continue and hope for the best here. but tell me the response so far because you were initially upset with the response from ex-onmobile. we talked to them today. they said they're there in force with full resources responding as best they can. they have claims adjustors standing by to help with monetary damages. what's the situation now as you see it? >> well, it will never be enough. of course, we're expecting a full clean-up. that the yellowstone river will be completely restored. of course exxon mobile has repeated over and over that they are financially responsible to those state and federal agencies that are involved in the clean-up and ultimately the private land owners along the river. so it's a wait-and-see attitude. to pair phrase from president reagan with this company we

will verify and verify. >> brown: to be clear at this point, has the leak actually stopped? has oil stopped spilling from the pipeline? >> there are shut-off valves approximately 600 meters wide on both sides of the river. so according to the company, some seven minutes after they detected a pressure drop, they started shutting down the pipeline. they had the oil shutdown within 30 minutes. this is a 12-inch pipeline that runs at 400 p.s.i., so maybe 2,000-3,000 gallons per minute flows through the pipeline. of course after they shut it down that 600 meters of oil would have flowed into the river. they estimate it's a 42,000 gallons maybe only exxon mobile would know for sure. >> brown: what are the concerns? of course you have this special problem of waiting for the water to go down a bit but you have farming, you have water, municipal water.

you've got fishing. tell us what it is that you're watching most carefully at this point. >> well, each of the water systems for the towns down river we need to watch and make sure that the levels of oil are down so it's safe for them to open their intakes and begin purifying water. we're concerned about farmers' fields and life stock that will drink the water or eat the grass. of course, we're most concerned about montana's $400 million trout fishing industry. people come from all over the world to see the rivers that run through it. 11 million people visit every year to see montana's remarkable landscape and wildlife. we want to make sure that this river, like the rest of the rivers in montana, are completely restored for this generation and the generations to come. >> brown: at the same time the oil industry, oil production, transportation is an important industry in your state as well. has a lot of support there and a lot out west. is this causing you to rethink any of that support?

>> well, this pipeline actually is an older technology pipeline. we no longer lay pipelines in the beds of rivers. the newer technology is is that we actually horizontal bore 25 feet and deeper beneath the beds of the river. so if a catastrophe like this were to occur, it would be separated from the water flow. but unfortunately this one was only buried five or six feet in the bed of the river. and with the yellowstone river raging at historic levels it's like a thousand mini-bulldozers that are cutting new channels in the bottom of that river, tearing down huge trees and moving bolders from the rocky mountains towards north dakota. this is the natural nature at work, and this pipeline probably just wasn't very deep... buried deep enough. that's why new technology influences horizontal boring. i asked exxon mobile if they replace this silver-tip pipeline, will they use hor zontal boring and they assured

us that they would. >> brown: some of the biggest current question out there is the so-called keystone pipeline, the one that is projected from canada all the way through montana down to oklahoma, texas, the gulf coast. now does that... is what you're seeing happen now, does that cause any new questions about something like that? >> actually in my conversations with the company that proposed the keystone xl, they've assured me that, a, they've used this boring techniques so none of these pipelines will be laid into these river beds. and secondly, instead of having humans involved in the shut-off devices you see this device that was placed along the yellowstone river was actually controlled out of houston texas. you got it. in montana, they had controls in houston texas. after some seven minutes they started shutting the pipeline down. it took about 0 minutes. trans-canada has explained to me that across ever river and

stream in montana that they would have automatic shutdown valves and backed-up systems by humans so that this kind of catastrophe would not and could not occur. first the pipeline is not in the river. secondly there are automatic immediate shutdown systems which exxon-mobil did not have in the silver tip. >> brown: governor, good luck with the situation out there now. >> thank you.or >> ifill: venezuela's big man returns home, but how much diminished? ray suarez has that story. >> suarez: celebrations erupted in caracas as news spread that hugo chavez was back on the eve of venezuela's bicentennial celebrations. the ailing 56-year-old leader made his surprise return from cuba early monday. >> ( translated ): fidel and raul castro practically got on the plane with me.

a perfect journey, perfect landing. i'm fine. i'm happy. i'm happy. >> suarez: a short time later, he addressed cheering crowds from a balcony at the presidential palace. >> ( translated ): i can't be here for very long. i am subject to, and am going to be subject for a while, to strict medical control. you know the reasons why. this battle we are going to win, and we are going to win it together. >> suarez: chavez even waved a large venezuelan flag, but he appeared paler and thinner than before. today, he stayed away from a huge independence day parade, where thousands of troops marched before vast crowds. the president did appear with top military leaders and addressed troops on live tv. he had arrived in havana on june 8 on a previously scheduled visit. cuban president raul castro was seen greeting him. the venezuelan foreign ministry reported doctors operated on june 10 to remove a pelvic abscess. chavez himself was not seen or

heard until state tv aired footage of him meeting with fidel castro last week. shortly after, chavez personally announced he'd had a second, follow-up surgery. >> ( translated ): doctors started, therefore, and immediately, another series of special studies, cyto-chemistry, which confirmed the presence of an abscess tumor with the presence of cancer cells, which made necessary the realization of a second surgery to allow the complete removal of the tumor. >> suarez: chavez insisted monday that he will win what he called "this battle for life". but his illness comes at a time of rising economic discontent in one of the world's leading oil- exporting nations. the charismatic leader has dominated venezuela for 12 years. he was briefly ousted by a coup in 2002, but regained power. u.s. support for his opponents only stoked his fiery criticism of american policy. he once branded president george w. bush "a devil," and later referred to president obama as an "ignoramus." for now, though, supporters and

opponents-- both foreign and domestic-- are watching to see if chavez is healthy enough to run again in next year's presidential election. for more, we turn to moises naim, a senior associate at the carnegie endowment for international peace and a former trade minister for venezuela; and michael shifter, president of the inter-american dialogue, a washington-based think tank. gentlemen, with much fanfare, hugo chavez said this is the beginning of the return. how does this recent information moises on the health of hugo chavez affect his political future? >> his health is still a state secret. we know he's very sick. we don't know exactly where or the extent of his illness. but what that has done is unleash a fierce battle for succession among his supporters. and for the first time in the... for 12, 15 years that he has been in power, millions of venezuelans are beginning to think what would the country

look like without having chavez at the center of the national life? >> suarez: michael, does it necessarily strengthen the hand of the opposition? >> well, it depends clearly on how sick chavez actually is. we really don't know that. there hasn't been any information disclosed. what we do know is he still has charisma. he still has his following. the faithful are still behind him. we don't know how the opposition is is going to respond. the opposition has been united in the last few years but there are very heat row genius group and the risk of splitting and fracturing is high. so we'll have to see how they respond to this, whether they focus on their electoral strategy, focus on coming up with solutions to the country's problems because the country is not in good shape. and trying to take advantage of this moment. and also how they respond to chavez's illness. i think that's going to be a real test for the opposition. >> suarez: there is an

election next year, moises. do they have to be careful? it seems like they are choosing their words very carefully from the... coming from the reporting, not to spark a back lash. >> the main political story in venezuela today is not about the opposition. the main story is about what's happening inside the different factions of the supporters of president chavez. there are different groups. they are divided by ideology, by economic interests, by links with cuba or with the military or industry. all of these are very powerful forces and very powerful players. chavez,... it's very usual for these kinds of leaders not to create strong structures that can replace them. that's the situation. without chavez, there will be a vacuum. there will be a lot of jockeying for power in trying to replace him. the different groups will try to find new alliances and

build new coalitions perhaps including some in the opposition. so it is a very fluid political situation where we can be surprised by seeing alliances that were unthinkable when president chavez was the main factor in the country. >> suarez: michael, do you agree with that? >> i think president chavez is still... he did rush back from cuba because i think he was worried that his government was weakening. and the longer he stayed away, the higher risk there was of these kinds of power struggles going on within his own movement. i think the cubans who, after all, rely on venezuela for a hundred thousand barrels of oil a day are very worried about any change in government. there's no guarantee whoever follows chavez will continue to provide that to cuba. i think they wanted him to get back to venezuela to show that he's in charge. he's in control. he's still connected to a lot of venezuelans who still believe in him.

as a result for the time being at least how long... how long it will last we'll see. but for the time being some of these power struggles have been put off or contained for the moment. i think there was real concern on chavez's part that it would get out of control. it was almost an emergency return to venezuela. >> suarez: moises, cubans as interested as hug hugo chavez himself about not having a long recuperation in havana. >> yes. as michael said, it is in their interest that chavez continues the helm of the country. cuba is critically dependent on the supplies of oil and money and all the resources from venezuela. cuba is undergoing a very, very difficult transition. that transition will become impossible outvenezuela's support. it is in the national interest of the cuban government to ensure that chavez or someone that thinks like him sustains their relationship in the same way which is massive support.

>> suarez: what about venezuela itself? upon his return, what's the state of the country? >> that is a very controversial question, of course, because supporters will tell you that there is great progress in a variety of areas. i think the objective numbers are that venezuela has the highest inflation in the world. that is one of the few countries in latin america, perhaps the only country together with haiti that is not posting economic growth. at the time in which oil is reaching a record level and generating record levels of income to the country, there are shortages even of gasoline and electricity and food staples. crime is soaring. so there's a long list of things that are not working in the country. and the paradox of a country in which a president that has had a blank check, both financially and politically after 12 years, what he has to

show is a very, very weakened society, a highly polarized society. as i said a very bad economic situation. >> suarez: that's domestic. what about internationally? hugo chavez has worked very hard over the last dozen years to cultivate friends and sympathetic regimes in the region. how has he done on that score? >> he's losing a lot of influence. i think the domestic problems which are getting worse and worse are related to his capacity to exercise influence in the region. he doesn't have enough money to distribute to his friends. and the best evidence of this, ray, is that the president-elect of peru who is coming to washington today five years ago identified with chavez and received money from chavez. now in this regent election he distanced himself very deliberately and consciously from chavez because chavez's brand of leftism really doesn't work. it relies on one person,

arbitrary rule to make all the decisions. we're seeing the results. so if you want to be successful politically in the region don't embrace this leader and this regime because this type of governance is not viable. >> suarez: given what michael just said, moises, how important is hugo chavez at the latin america desk at the state department? is he still the figure of intense interest that he's been earlier in this century? >> they're watching him and what he does carefully because, remember that even though michael is absolutely right that he supports among leaders in the region has dwindled, he has strong leanings with iran and other regions. there are all sorts... he's one of the biggest clients of the russians arms industry. he has strong and strange ties with the iranian government, with the belarusian government. they are watching carefully what's going on. but again his new condition,

his new illness may change the equation also on that front. >> suarez: could he string out this uncertainty about his future, michael, well into the election season next year? >> well, he could. but he'll be weakened politically. i think right now there's a lot of compassion, sympathy for him, solidarity which is understandable. but the election is too far away for that to last very long. other factors like the situation of the country, i think, will really be much more relevant. and there is an opening for the opposition. i think there is a chance for somebody to come forward and say, i have a different solution to these problems because crime is out of control, the economic situation is terrible. i don't see any way that that's going to change between now and the election. if anything, it will get worse. >> suarez: is there enough social space for the opposition to speak openly like that? >> there's enough. i think that there's, you know, chavez controls the institutions and he does exert a lot of control but i think there are also some media

where the opposition can express themselves. there's an openness for that. venezuela is not a tightly repressive, controlled society. it's more fluid. and even though chavez has control of the key institutions i think there is an opportunity. to its credit the opposition has decided to play by the electoral rules of the came, democratic rules of the game and will try to defeat chavez in the upcoming election. >> suarez: michael shifter, moises naim, thank you both. >> woodruff: again, the major developments of the day: massive explosions rocked a government building in iraq, killing at least 37 and injuring dozens. president obama invited congressional leaders to the white house for new talks on a deal to reduce the deficit and raise the debt ceiling. a state investigation in georgia implicated nearly 180 teachers and principals in cheating to raise standardized test scores. it is the largest cheating

scandal in u.s. history. and to hari sreenivasan for what's on the newshour online. hari. >> sreenivasan: there's more on the life of artist cy twombly. jeff talks to the head of contemporary art at the art institute of chicago, and we have a slideshow of twombly's work. that's on "art beat." and on this week's political checklist, gwen and judy talk deficit negotiations and debt ceiling deadlines with political editor david chalian. plus, which countries are the world's most dangerous for women? our foreign affairs beat looks at a new survey on the matter. find that on our "world" page. all that and more is on our web site, newshour.pbs.org. >> ifill: and again to our honor roll of american service personnel killed in the iraq and afghanistan conflicts. we add them as their deaths are made official and photographs become available. here, in silence, are six more.

>> woodruff: and that's the newshour for tonight. on wednesday, we'll look at the political and marketing reach of social media. i'm judy woodruff. >> ifill: and i'm gwen ifill. we'll see you online and again here tomorrow evening. thank you and good night. major funding for the pbs newshour has been provided by:

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